Corporate Responsibility

An Overview

When Carhartt was founded in 1889, Hamilton Carhartt spoke about the role of a responsible business, stating that it should do “the just and honest thing, gainful if possible.”

100 years on, in 1989, Swiss-national Edwin Faeh started to import a small range of Carhartt workwear through his agency ‘All American Concept’. By 1994, a distribution network for Carhartt was set up in Europe (Work In Progress Textilhandels GmbH), introducing a selection of classic products from the original workwear collection.

Today, we look back with pride on our American heritage and take inspiration from it. We constantly strive to improve our business practices for the benefit of the environment, our employees, the workers producing our products and our consumers.

Our Corporate Responsibility revolves around three areas:

Supply Chain

Product

Operations

Supply Chain

How We Produce Our Garments

Carhartt WIP products are manufactured and sold globally. This globalization and the complexity of textile supply chains bring challenges to the way we produce our garments. It also highlights potentially negative aspects of garment production, making us very careful in how we select our suppliers and who we choose to partner with. As a premium brand, Carhartt WIP is committed to producing high quality, ethically manufactured products, whilst also providing good value to our customers.

A. RESPONSIBLE SOURCING EXPLAINED

Code of Conduct

Carhartt works with a Code of Conduct which is periodically revised and defines the minimum set of standards that we expect our factories to meet. The Code is based on internationally accepted labor standards, including the International Labour Organisation’s Core Conventions and the Universal Declaration of Human Rights. We aim to partner with companies that share our corporate values and, like us, are committed to continuous improvement on social and environmental practices.

Supplier Monitoring

We choose our partners with longevity in mind and place great value on building lasting business relationships. The production of Carhartt WIP garments is centered around a company-owned factory in Tunisia and a network of suppliers globally. We set-up the following monitoring system with all our suppliers:

Initial alignment - As an initial step, Carhartt WIP suppliers must agree to align their operations with our Code of Conduct and are encouraged to extend the code upstream to their suppliers. Information about the supplier is gathered through a self-assessment and a physical visit from our internal teams.

Independent verification of working conditions - Working conditions at Carhartt WIP sourced facilities are audited by third-party auditors according to, for example, the “Worldwide Responsible Accredited Production” (WRAP) or the “SA8000® Standard”, amongst others. These independent processes verify the working conditions through a detailed assessment comprising of:

in-depth interviews with both management and workers

a physical inspection of factories

a review of documentation and records.

Internal verification - We are aware that certifications and third-party auditing alone do not bring absolute certainty that all issues are solved at factory level. As a result, we also have an internal team who visits our suppliers to support them in order to achieve compliance with our Code of Conduct. We aim for a transparent and long-term dialogue with our partners, with a desire for continuous improvement.

Restricted Substances List - We actively work to prevent the use of harmful chemicals to protect both customer’s health and the environment. Our “Restricted Substances List” (RSL) represents our minimum requirement when it comes to chemical management. This list follows international laws and regulations and is updated on a yearly basis. To ensure compliance, we work closely with our suppliers in order for them to understand the RSL and test our products each season.

B. PRODUCTIONS REGIONS

Carhartt WIP manufactures its products in two main regions:

EMEA (Europe Middle East Africa) - Carhartt WIP has owned and operated a facility in Tunisia for the past 15 years. The comfort and wellbeing of our near 700 employees have been a key aspect for us from the beginning. In order to monitor this, we decided to become SA8000 certified. This means that good working conditions and healthy management-employee relationships are in place, which we are able to monitor on a continuous basis thanks to the management systems we put in place through the SA8000 certification. In addition, most of the fabrics used for our iconic styles are produced in Europe from suppliers that have been our partners for many years.

Asia - Carhartt WIP also works with suppliers in Asia. We make it an essential requirement to source from suppliers with a very good social and environmental track record. Our goal is to establish long-term relationships with leading suppliers, based on trust and mutual respect. We regularly visit our suppliers to review the working conditions and work with them in order to reach compliance with our Code of Conduct.

C. ENVIRONMENTAL IMPACT OF OUR WASHES

Carhartt WIP uses different production processes to make its pants look the way they look. Almost eighty percent of our bottoms are “rinsed” or “rigid”. This means that they are not heavily treated and therefore have a lower impact on the environment compared to other techniques.

Based on an assessment of our different product finishing techniques through the EIM (Environmental Impact Measuring) software, these rinsed and rigid washes score green on energy, water, and chemical consumption meaning a low impact on the environment. Based on these results, we are working on optimizing the finishes that have a higher environmental impact by researching more sustainable solutions available on the market.

Product

Choosing the right material

Since its inception in 1889, Carhartt’s mission has been to create enduring apparel. Maintaining high standards on quality, comfort and durability are essential aspects of our brand’s offer. Therefore, the materials we use in our garments have to pass our detailed and expert testing.

More than half of our collection is made out of cotton. Although cotton is a natural fiber, we acknowledge that conventional cotton production has negative social and environmental impacts, which we want to help reduce through our sourcing decisions. Beyond this, we are also exploring options to reduce our cotton use by looking into other fibers.

Cotton

Organic Cotton - An environmentally friendly alternative to conventional cotton, organic cotton is grown naturally, without the use of chemical pesticides and synthetic fertilizers. This means that it is better for the health of the farmers growing it, the local community and for the environment. We are currently in the planning of a range of organic cotton products, which will be announced soon.

Better Cotton Initiative (BCI) - We are a member of the “Better Cotton Initiative” (BCI). The initiative, which was founded in 2009, aims to make the global cotton production better for the people who produce it, better for the environment it grows in and better for the sector’s future, by developing Better Cotton as a sustainable mainstream commodity. BCI’s goal is to cover thirty percent of the global cotton production by 2020. Carhartt WIP is committed to increasing the sourcing of Better Cotton in its products year on year.

Other sustainable fibers

We actively engage with our fabric suppliers to explore sustainable alternatives that match our quality and durability requirements. Carhartt WIP constantly reviews the available technologies to seek out opportunities for improvement.

Operations

Our biggest social and environmental impact lies within the supply chain. Yet, we are committed to running our operations efficiently with no unnecessary harm to the environment. Our operations are set-up around a central headquarters and warehouse, both located in Weil am Rhein, Germany.

Logistics - The warehouse is fully equipped with state of the art technology in order to make the packing of our products as efficient as possible. All of the boxes that we use to dispatch our products to customers are made out of 65–77 percent recycled material depending on the size of the box. For overseas shipping, we use ocean transport – and only in exceptional cases do we use air freight. We also ensure that containers are full before being shipped out.

Solar Panels - Since 2005, the rooftop of our headquarters, our warehouse and our outlet in Weil am Rhein have gradually been covered with solar panels representing today a surface of approximately ten thousand square meters. This enables us to generate roughly 1.3 million Kilowatt-hours of energy per year, which can provide about 430 households in Germany with electricity.

Green Electricity - Due to broader renewable energy legislation on solar panels in Germany, the electricity sourced by our solar panels has to be fed into the general network. However, in an effort to reduce our environmental impact, we reviewed our energy choices and now use solely green electricity from water power for all our locations in Germany. We are now, step by step expanding to other countries.

Code of Conduct

As a premium brand, Carhartt WIP is committed to conducting business in a fair and ethical manner. Consistent with this commitment, we have established this Code of Conduct as a minimum set of standards for both our internal operations as well as our business partners. This Code is based on internationally accepted labour standards, including the International Labour Organization’s Core Conventions and the Universal Declaration of Human Rights. While this Code establishes minimum standards, we aspire to partner with companies that share our corporate values and are committed to continuously improving and environmental practices.

As used herein, the term supplier is defined broadly to cover the full range of Carhartt WIP's supply chain partners, including cut and sew suppliers that provide finished garments, direct and “nominated” suppliers of fabrics, trims and other raw materials, licensing partners, transportation and logistics providers and other supply chain partners.

Employment Relationship - Carhartt WIP suppliers and their authorized subcontractors will adopt and adhere to rules and conditions of employment that respect workers and, at a minimum, safeguard their rights under national and international labour and social security laws and regulations.

Compliance with Laws and Workplace Regulations Carhartt WIP suppliers and their authorized subcontractors comply with laws and regulations in all locations where business is conducted, including those relating to employment, social security, health and safety, and the environment. It is also expected that suppliers and their authorized subcontractors will cooperate fully with Carhartt WIP in its compliance with local laws applicable in countries where Carhartt WIP does business.

Prohibition of Forced Labour - Carhartt WIP suppliers and their authorized subcontractors will not employ involuntary workers, prisoners or trafficked workers or labour that has been obtained by force, fraud, coercion, slavery or otherwise.

Prohibition of Child Labour - Carhartt WIP suppliers and their authorized subcontractors will not hire any employees under the age of 15, who are still at the age of compulsory schooling, or those who are under the minimum working age established by law.

Prohibition of Harassment or Abuse - Carhartt WIP suppliers and their authorized subcontractors strive to establish workplaces where every employee is treated with respect and dignity. No employee shall be subjected to any physical, sexual, psychological or verbal harassment, abuse or corporal punishment.

Compensation and Benefits - Carhartt WIP suppliers and their authorized subcontractors will pay at least the minimum wage established by local law, including all statutory wages, allowances and benefits.

Hours of Work - Carhartt WIP suppliers and their authorized subcontractors comply with daily and weekly workings hours that do not exceed the legal restrictions in the countries in which they do business. Suppliers will provide at least one day (24 hours) off in every seven-day period, unless urgent requirements in the company must be met. Suppliers are requested to limit the total weekly working amount for all employees to 60 hours and to only allow overtime if it is worked voluntarily.

Prohibition of Discrimination - Carhartt WIP suppliers and their authorized subcontractors will employ, reward, promote, and dismiss workers based on their ability to do the job and not on the basis of personal characteristics or beliefs. No one shall be subject to any discrimination based on sex, ethnicity, religion, age, disability, sexual orientation, nationality, political opinion, social group or ethnic origin in the workplace. Nor will any personal characteristics affect recruitment, salary, promotion, reprimand, dismissal or resignation.

Health and Safety - Carhartt WIP vendors and their authorized subcontractors will provide a safe and healthy working environment to prevent accidents and injuries resulting from, associated with or occurring during work or as a result of the operation of the employer’s facilities. Carhartt WIP production is prohibited in multi-floor factories with more than one tenant. If employees are provided with accommodation, it is the supplier’s responsibility to ensure that the accommodation is safe and healthy.

Freedom of Association & Collective Bargaining - - Carhartt WIP suppliers and their authorized subcontractors shall recognize and respect the rights of employees to freedom of association and collective bargaining.

Environmental - Carhartt WIP suppliers and their authorized subcontractors will comply with environmental rules, regulations and standards applicable to their operations, and will adopt responsible measures to mitigate negative impacts that the workplace has on the environment.

Customs Compliance - Carhartt WIP suppliers and their authorized subcontractors will comply with applicable customs law and, in particular, will establish and maintain programs to comply with customs laws regarding illegal transshipment of apparel.

Bribery and Corruption - Carhartt WIP suppliers and their authorized subcontractors will not, in connection with any aspect of their business with Carhartt WIP, directly or indirectly offer bribes or any other improper form of payment or benefit to influence another individual, company, organization, government official or body, or political party or candidate, regardless of whether it is officially tolerated or condoned.

As noted in this Code of Conduct, Carhartt WIP aspires to partner with companies that share its corporate values and are committed to continuous improvement of social and environmental practices. It is our intent that the standards outlined in this Workplace Code of Conduct be applied throughout the global network of suppliers involved in the development, manufacture and transport of Carhartt WIP products. Suppliers with which Carhartt WIP has a direct contractual relationship are expected to extend these standards to all sub-tier suppliers and to initiate practices to assure that aligned standards are adopted throughout the global supply network supporting Carhartt WIP.